Mines Ministry Amends Rules To Publish ASP For Low Grade Haematite

15 Apr 2026 CW Team

The notified threshold value for haematitic iron ore is 45 per cent Fe. Previously there was no methodology to publish the ASP for haematite with Fe content below the threshold and the ASP for the lowest grade above the threshold, that is 45 per cent to below 51 per cent Fe grade, was being applied to below threshold grades. Using the higher grade ASP for levying royalty and auction premium rendered beneficiation uneconomical and discouraged optimal utilisation of resources.

The amended rules set the ASP for grades between 35 per cent and below 45 per cent Fe at 75 per cent of the average sale price of the 45 per cent to below 51 per cent Fe grade. For grades below 35 per cent Fe the average sale price is set at 50 per cent of the average sale price of the 45 per cent to below 51 per cent Fe grade. These calibrated price adjustments are intended to make beneficiation financially viable for a wide range of low grade iron ore resources.

The change is expected to bring extensive quantities of low grade haematite into usable categories, ease pressure on high grade deposits and support a steadier supply of feed grade ore to the steel sector. The amendment also clarifies that where processing of run-of-mine results in a decrease in economic value, royalty will be chargeable on lumps and fines after initial screening of unprocessed run-of-mine. The term run-of-mine refers to raw unprocessed or uncrushed material obtained after blasting or digging from the mineralised zone and the rules emphasise that economic value cannot be lowered by processing to avoid royalty obligations.

The Ministry of Mines has notified the Minerals (Other than Atomic and Hydro Carbons Energy Minerals) Concession (Third Amendment) Rules, 2026 on 10 April 2026, introducing a methodology for publishing the average sale price (ASP) of haematite iron ore that falls below the threshold value, including Banded Haematite Quartzite (BHQ) and Banded Haematite Jasper (BHJ). The amendment was framed to permit beneficiation of low grade material that was previously uneconomical to process. The move reflects improvements in beneficiation technology that allow such material to be upgraded to feed grade ore for steel making. The notified threshold value for haematitic iron ore is 45 per cent Fe. Previously there was no methodology to publish the ASP for haematite with Fe content below the threshold and the ASP for the lowest grade above the threshold, that is 45 per cent to below 51 per cent Fe grade, was being applied to below threshold grades. Using the higher grade ASP for levying royalty and auction premium rendered beneficiation uneconomical and discouraged optimal utilisation of resources. The amended rules set the ASP for grades between 35 per cent and below 45 per cent Fe at 75 per cent of the average sale price of the 45 per cent to below 51 per cent Fe grade. For grades below 35 per cent Fe the average sale price is set at 50 per cent of the average sale price of the 45 per cent to below 51 per cent Fe grade. These calibrated price adjustments are intended to make beneficiation financially viable for a wide range of low grade iron ore resources. The change is expected to bring extensive quantities of low grade haematite into usable categories, ease pressure on high grade deposits and support a steadier supply of feed grade ore to the steel sector. The amendment also clarifies that where processing of run-of-mine results in a decrease in economic value, royalty will be chargeable on lumps and fines after initial screening of unprocessed run-of-mine. The term run-of-mine refers to raw unprocessed or uncrushed material obtained after blasting or digging from the mineralised zone and the rules emphasise that economic value cannot be lowered by processing to avoid royalty obligations.

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